November 11, 2017 / 8:16 AM / a year ago

Boeing sees steady Gulf demand, interest in mid-sized jet

DUBAI (Reuters) - Boeing (BA.N) sought to dispel concerns about a slowdown in the growth of Gulf airlines as the aerospace industry gathered on Saturday for the Dubai Airshow.

FILE PHOTO: Boeing's logo is seen during Japan Aerospace 2016 air show in Tokyo, Japan, October 12, 2016. REUTERS/Kim Kyung-Hoon/File Photo

Speaking on the eve of the showcase event, executives at the U.S. planemaker also played down the impact of growing political tensions in the region.

“Traffic is coming back and yields are improving and this is going to be a very positive backdrop to the Dubai Airshow,” Marty Bentrott, vice president for Boeing’s commercial sales in the region, said, citing higher profit at Dubai’s Emirates.

Boeing had been asked to reschedule some deliveries according to a normal pattern but had not seen cancellations since a rift between Arab nations and Qatar earlier this year.

At a news conference, Boeing executives mainly deflected questions about a domestic purge of dozens of members of Saudi Arabia’s political and business elite in the past week but played down concerns over its economic impact.

“There is absolutely no change. We consider the Kingdom of Saudi Arabia to be a very strong partner and we are going ahead with our plans,” Ahmed Jazzar, president of Boeing Saudi Arabia, said.

The planemaker, meanwhile, said it had seen strong regional interest in a proposed new mid-sized passenger jet.

Industry sources expect a commercial launch of the roughly 220-270 seat jet next year. It would enter service in 2024-25 as Boeing attempts to leapfrog the hot-selling Airbus (AIR.PA) A321neo.

The aircraft will be designed around an unusual elliptical, or ‘squashed’, shape of fuselage that contains less room for cargo than other planes of its size. Experts say that is in order to improve the aerodynamics and cut running costs.

Boeing planners say most airlines interested in that type of plane do not expect to carry much cargo on their targeted routes.

Asked whether that would be a problem for airlines in the Gulf, most of which carry significant amounts of freight in the bellies of their passenger planes, Bentrott said: “There is nothing but tons of interest and excitement (in the region). There is not any concern about cargo capability.”

He added, “We hope to get it into the market in the not-too-distant future.”

Reporting by Tim Hepher; editing by Alexander Smith and Louise Heavens

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